World Markets Weekend Review: A Very Mixed Bag

The world market makers shuffled the chairs on the deck last week. The Shanghai Composite, the worst performer for the two previous weeks, took the top spot by a wide margin, up 2.93%. Hong Kong's Hang Seng was a distant second, and India's third place BSE SENSEX barely broke even. At the other end of the deck, France's CAC 40 lost nearly 5%, far behind the next-to-last German DAXK, which was down over 3%.

This past, week two indexes on the watch list are in bear territory -- the traditional designation for a 20% decline from an interim high -- one more than last week. See the table inset (lower right) in the chart below. At the bottom of the Bear Zone is, of course, the Shanghai Composite, which is a stunning 39.90% off its interim high of August 2009. The other bear-zone index is Japan's Nikkei, which closed the week in sixth place with a 2.63% loss. At the other end of the inset, the S&P 500 is now 1.71% off its interim high.

As for year-to-date performance, here is a table showing the 2012 peak percentage gains, sorted in that order, and current YTD gains for the eight indexes. The BSE SENSEX closed the week at its 2012 high. In contrast, the Shanghai continues to hold dubious distinction of being the only index with a YTD loss.

A Closer Look at the Last Four Weeks

The tables below provide a concise overview of performance comparisons over the past four weeks for these eight major indexes. I've also included the average for each week so that we can evaluate the performance of a specific index relative to the overall mean and better understand weekly volatility. The colors for each index name help us visualize the comparative performance over time.

The chart below illustrates the comparative performance of World Markets since March 9, 2009. The start date is arbitrary: The S&P 500, CAC 40 and BSE SENSEX hit their lows on March 9th, the Nikkei 225 on March 10th, the DAX on March 6th, the FTSE on March 3rd, the Shanghai Composite on November 4, 2008, and the Hang Seng even earlier on October 27, 2008. However, by aligning on the same day and measuring the percent change, we get a better sense of the relative performance than if we align the lows.

A Longer Look Back

Here is the same chart starting from the turn of 21st century. The relative over-performance of the emerging markets (Shanghai, Mumbai SENSEX, Hang Seng) is readily apparent, especially the SENSEX, but the trend over the past two years has not been their friend (make that three years for the Shanghai).

Check back next weekend for a new update.